Tory MP backs windfall tax on energy giants

Pressure today mounted on David Cameron to help reduce energy bills after a Tory London MP backed hitting power companies with a windfall tax.

Harlow MP Robert Halfon said the one-off levy proposed by former Conservative Prime Minister Sir John Major would be the “right thing to do”.

Tory grandee Peter Lilley also called on Mr Cameron to impose tougher rules on the “Big Six” firms that dominate the energy market. The calls come as a survey today found most pensioners, low-earners and disabled people were worried about meeting bills this winter, with many suffering “uncomfortably cold” homes to save money.

Mr Halfon claimed energy firms are charging “too much” and that revenue from a windfall tax could be used to help low-income families.

The MP told BBC Radio: “A windfall tax as part of a package of measures on the energy companies, that are charging customers too much and giving themselves hefty pay rises, is the right thing to do.

“But with the proviso that it needs to be done in conjunction with the reducing of green taxes and, in the long term, reducing VAT on our energy bills.”

In his conference speech Labour Leader Ed Miliband said a Labour government would freeze energy bills if elected.

Cities of London and Westminster MP Mark Field dismissed the windfall tax idea today but said the Government did have to act in response to Labour’s proposal.

He said: “There’s no doubt Ed Miliband’s pledge has struck a chord. But the idea of a windfall tax is dangerous, it risks the UK no longer being seen as a bastion of reliable open trade.”

Mr Lilley, MP for Hitchin and Harpenden and a former Secretary of State for Social Security, also rejected Sir John’s idea.

He said: “If [profits] are made through monopoly power and [firms] are putting up prices more than is justified...then we want more competition and tougher regulation to get those prices down.”